What is CSAT? Definition and How to Measure

What is CSAT? Also known as Customer Satisfaction score, CSAT is an attempt at capturing how satisfied customers are with a company’s goods and services. A survey asks a customer to rate their satisfaction, typically on a scale from 1 to 5.

The ISO 9001 standard defines Customer Satisfaction as a customer’s perception of the degree to which their requirements have been fulfilled.

HOW TO MEASURE CSAT?

The primary objective of CSAT is measuring customer feedback and adjusting to increase customer satisfaction. CSAT is often gathered through surveys that ask variations of questions such as how the customer feels about the goods or services that they have received. The scale is often based on a scale of 1 to 5 with 1 being very unsatisfied and 5 being satisfied. CSAT is represented as a percentage and can be calculated using this formula:

(Number of satisfied customers / Number of survey responses) x 100 = % of satisfied customers

Here are three different models used to reach an aggregate measure of customer satisfaction with a company, or CSAT:

Average CSAT

One model is to survey customers on their overall satisfaction with a company’s goods and services. In this model the average of all of the customers scores becomes the CSAT for the company.

CSAT on Dimensions of Satisfaction

Another option is to define dimensions that are considered drivers of satisfaction e.g.: timeliness of delivery, friendliness of staff, product quality, product design, pricing, etc. and measure satisfaction with each dimension. The aggregate score or index can then be calculated as a weighted average of these sub scores. This assumes one knows the weight of each driver in driving actual customer satisfaction and behavior.

A better approach–and one way to uncover possible sources of dissatisfaction–is to use this in conjunction with the overall company CSAT score. After forming hypotheses on the possible drivers of satisfaction, and calculating CSAT score along these attributes, one would try to correlate these subscores with the overall CSAT above.

CSAT at Customer Journey Points

Rather than scoring along a set of products or services characteristics, a third model scores customer interactions along the buyer’s journey. This is based on the idea that customer satisfaction is impacted at each customer touchpoint throughout the journey. Mckinsey’s view is that measuring satisfaction on customer journeys is 30 percent more predictive of overall customer satisfaction than measuring happiness for each individual interaction.

WHY IS CSAT IMPORTANT? 

CSAT is important for businesses to discover a variety of insights such as who the customer is, what are customer pain points, what are competitors doing better, etc. These insights will then translate into opportunities to improve customer satisfaction and drive critical business decisions.The value of measuring CSAT is to improve customer retention. Customers value positive experiences and therefore CSAT can be used throughout the customer journey to identify and improve their experiences. 

Learn more about InMoments CSAT software that makes measuring customer satisfaction easy, timely, and actionable.

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